In October 2002, Sydney Water aborted a customer information and billing system (CIBS) project midway through its development at a cost of A$61 million; the original price to complete was A$38 million. At the time of cancellation, it was estimated that another A$64 million would be needed to complete the effort.
According to an investigation by the Australian New South Wales Auditor General, among the factors that doomed the project were inadequate planning and specifications, which in turn led to numerous change requests and significant added costs and delays.
Sydney Water in 2003 sued PricewaterhouseCoopers (PWC) who had been contracted to implement the CIBS. Sydney Water had paid PWC $29.4 million by the time the project was canceled.
PWC then filed a cross-claim against Sydney Water. PWC said that since Sydney Water unilaterally canceled the project, CIBS couldn't be claimed by Sydney Water to be a project failure. In PWC's opinion, they could have eventually delivered the billing system (with more money from Sydney Water, of course).
In May of last year, the two settled out of court.
According to Sydney Water's 2008 Annual Report,
"Resolution of the dispute was reached on terms that, without admission of liability, PwC pay Sydney Water an amount of A$5 million in settlement of the claim against it, and Sydney Water pay PwC an amount of A$2,798,000 (plus GST) in settlement of the cross-claim against it. Each of Sydney Water and PwC agreed to bear their own legal costs of the litigation."
You would think that after that very public fiasco, Sydney Water would be a bit more careful in how it did IT projects.
Last week, Australian NSW Auditor General disclosed that he found more IT projects in trouble, says ComputerWorld (Australia).
According to ComputerWorld,
"Sydney Water’s Customer Management System Stage 1 had overshot its original A$21 million budget and was now forecast to cost A$55.3 million. ... (and) had slipped from August 2009 to February 2011," reports ComputerWorld.
"The organisation’s Maximo consolidation project - aimed at replacing Sydney Water’s current asset management systems - also had significant budgeted overspend. Originally set at A$18.4 million, the revised budget had leapt to A$31.3 million and its deliver date had fallen behind from August 2009 to October 2010."
Another project, the Field Resource Management Stage 2, which is supposed to develop a geospatial information system and mobile documents capability, didn't overrun but slipped its schedule by 4 months.
The Information Management Program, meant to replace several disparate document management systems, still planned to meet its original A$24 million budget and delivery date of June 2011. Well, at least that is good news for rate payers.
And there is word today in ZDNet Australia saying that Sydney Water now plans to overhaul its customer and billing system again.
I wonder if they'll have better luck this time around.
Robert N. Charette is a Contributing Editor to IEEE Spectrum and an acknowledged international authority on information technology and systems risk management. A self-described “risk ecologist,” he is interested in the intersections of business, political, technological, and societal risks. Charette is an award-winning author of multiple books and numerous articles on the subjects of risk management, project and program management, innovation, and entrepreneurship. A Life Senior Member of the IEEE, Charette was a recipient of the IEEE Computer Society’s Golden Core Award in 2008.